Investors should be cautious before Tết holiday

An investor watches the market’s movements on his mobile phone. Photo baocongthuong.vn

HÀ NỘI — Many securities companies recommend investors cautiously disburse capital investments as the market has not been bullish, but some still believe that before the Tết holiday may be an opportunity to increase stock proportions in their portfolios.

On the Hồ Chí Minh Stock Exchange (HoSE), the VN-Index ended last week at 1,472.89 points, up 0.52 per cent, while the HNX-Index on the Hà Nội Stock Exchange (HNX) also finished higher at 417.84 points, up 1.47 per cent.

For the week, the VN-Index lost 1.55 per cent and the HNX-Index fell 10.5 per cent.

According to Việt Dragon Securities Corporation (VDSC), the VN-Index’s recovery rate slowed down and was cautiously approaching the 50-day moving average (MA50), equivalent to 1,478 points. However, the temporary resistance force is still not strong, so the market is in a state of struggle and test.

The market's uptrend has shown a sign of strong divergence, focusing only on certain groups of stocks, causing instability.

The benchmark VN-Index is expected to continue to struggle and MA50 level is likely to weigh on the index. Therefore, VDSC recommends that investors remain cautious and observe the market’s movements at the resistance zone and reevaluate the market’s states.

Meanwhile, Vietcombank Securities Company (VCBS) said that the market general sentiment has been relatively careful with key stocks, especially amid stock indicators in the US and Asia all turned negative.

On the other hand, the market is in a tug-of-war phase with no clear trend in the absence of supporting factors.

VCBS recommends that investors can actively reduce the proportion of stocks and increase the proportion of cash in portfolios while continuing to monitor the latest data on the domestic macroeconomics as well as the development of the COVID-19 pandemic to plan the portfolio restructuring for the whole year 2022.

On a technical front, BOS Securities Corporation said that all indicators show bearish signals. Investors are recommended to continue reducing the proportion of stocks, not participating in bottom fishing as the market's risks remain high.

Saigon-Hanoi Securities SJC (SHS) said that the Tết holiday has reflected a decline in the market's liquidity last week, with only about VNĐ27 trillion (US$1.2 billion) per session on both main exchanges. And the selling force dominated the market ahead of Tết , causing the benchmark indices to fall for the second week, the firm added.

Real estate stocks continued to post the biggest losses last week, with many stocks witnessing sharp declines like Development Investment Construction JSC (DIG) down 7.8 per cent, or FLC Group JSC (FLC) down 19.9 per cent.

The market was backed by bank and oil stocks later in the week.

SHS believes that the Vietnamese stock market has another less positive trading week before the Tết holiday, causing a significant decrease in liquidity and profit-taking pressure.

However, experts believe this is quite a common trend if looking at historical data. The market sentiment ahead of the Lunar New year is usually less positive, but it will improve after the holiday.

This makes the market correction before Tết an opportunity for investors to increase the stock's proportions in portfolios to take advantage of the potential increase after Tết .

It is forecasted that in the last trading week before Tết , the VN-Index is likely to recover with the target of the nearest resistance zone of 1,475-1,490 points.

"Investors who participated in bottom fishing on January 12 and increased the stock's proportions in the session on January 18 can continue to hold their current portfolios and rise the proportions if the market corrects to the support zone of 1,400-1,450 points this week," SHS said. —VNS